Gold prices dipped slightly on Wednesday as investors awaited U.S. payroll data and evaluated Federal Reserve Chair Jerome Powell’s cautious approach toward rate cuts. Nonetheless, a weaker dollar helped to mitigate losses for gold priced in dollars.
In Dubai, gold rates experienced fluctuations, with 24-carat gold falling AED1.25 to AED400.25, while 22-carat gold decreased AED2.25 to AED370.75. Additionally, 21-carat gold dropped AED2 to AED355.50, and 18-carat gold was down AED1.75 to AED304.75.
As of 02:17 GMT, spot gold was down 0.2 percent at $3,330.68 per ounce (currently trading at $3,340.01), while U.S. gold futures fell 0.3 percent to $3,340.60 (currently trading above $3,349.40). The U.S. dollar index weakened to its lowest level in over three years, making bullion more accessible for holders of other currencies.
Fed policy expectations take center stage
“Gold prices are consolidating after posting the strongest gains in two weeks. The overall trend bias continues to favor the upside for now,” Reuters reported, citing Ilya Spivak, head of global macro at Tastylive, who noted that Fed policy expectations are currently in the spotlight.
Powell reiterated that the U.S. central bank intends to “wait and learn more” about the impact of tariffs on inflation before considering any interest rate reductions, thereby pushing aside U.S. President Donald Trump’s calls for immediate and substantial cuts.
U.S. job openings unexpectedly increased in May, but a decline in hiring contributed to signs that the labor market is shifting into a lower gear amid uncertainty regarding the Trump administration’s tariffs on imports. Investors are now looking forward to U.S. ADP employment data, due later in the day, and nonfarm payroll figures on Thursday for further insights into labor market conditions.
“The biggest risk for gold is an unexpectedly strong (NFP) result, but that seems rather unlikely to happen,” Spivak commented.
Trump optimistic about trade deal with India
Meanwhile, U.S. Senate Republicans narrowly passed Trump’s tax-and-spending bill on Tuesday, a package that cuts taxes, reduces social safety net programs, and boosts military spending, while adding $3.3 trillion to the national debt. Trump expressed optimism on Tuesday about a potential trade deal with India but was skeptical about reaching a similar agreement with Japan. He also mentioned that he was not considering extending the July 9 deadline for countries to negotiate trade agreements.
Spot silver edged down 0.1 percent to $36.01 per ounce, platinum fell 0.4 percent to $1,344.91, while palladium gained 0.4 percent to $1,104.92.
Gold prices experienced a modest rise on Monday, increasing by 0.58 percent as the U.S. dollar continued its decline ahead of a busy economic calendar in the United States. Speculation that U.S. President Donald Trump might appoint a new Federal Reserve Chair by September or October negatively impacted the dollar, which is trading near lows last seen in February 2022.
In Dubai, gold rates fluctuated, with 24-carat gold priced at AED401.06 and 22-carat gold at AED371.32. Furthermore, 21-carat gold is listed at AED354.43, while 18-carat gold stands at AED303.80. On a global scale, spot gold rose by 0.14 percent, reaching $3,279.97. Meanwhile, U.S. gold futures increased by 0.05 percent to $3,289.55.
